Federal Government has directed the state-owned oil company, NNPC Limited, to halt certain deductions from oil and gas revenues, as part of efforts to strengthen oversight of the country’s petroleum income.
The decision was announced following the inaugural meeting of the Implementation Committee for Executive Order 9, signed by President Bola Ahmed Tinubu.
Under the new measures, NNPC Limited will no longer collect a 30% management fee or a 30% frontier exploration fund deduction from profit oil and gas under Production Sharing Contracts, with immediate effect. In addition, remittances of gas flare penalties into the Midstream and Downstream Gas Infrastructure Fund have been suspended.
The government said contractors will now pay profit oil, royalty oil and tax oil directly into the Federation Account. Officials indicated that a transition period would be observed to honour existing contractual arrangements and maintain investor confidence.
A Technical Subcommittee has been established to draw up guidelines for the transition. It will also review the Petroleum Industry Act to address what authorities describe as revenue leakages and structural weaknesses.
The Implementation Committee, chaired by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said it would continue to engage stakeholders and provide regular updates.
Officials said the reforms are aimed at ensuring that Nigeria’s petroleum resources deliver greater benefits to citizens.
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